The Strength of the Wolf (8 page)

Indeed, few FBN agents ever met the Commissioner; and if they did, it was while serving as his chauffeur when he was in town courting police chiefs or politicians. Anslinger only discussed Bureau matters with his deputies, never with agents. When he did receive an agent, he was reserved and soft-spoken, but direct and to the point. “If you got a ‘well done' from him,” Agent Howard Chappell recalls, “it was like getting a citation from someone else.” There were only a few agents Anslinger considered equals. Charlie Dyar was a close friend, as was Ralph Oyler. Both, like Anslinger, were married to money and when necessary, flamboyant enough to bring the Bureau favorable reviews.

Most everyone in Anslinger's inner circle came from the Old PU, and when he became Commissioner he took these men into the FBN and made them district supervisors. He had a soft spot for old-timers like George Cunningham, his deputy from 1949 until 1958, and Joe Bransky, the dean of district supervisors, stationed in Philadelphia. No one in the FBN after the Second World War ever got as close to him as they did, with the exception of Ross B. Ellis in Detroit and George White.

With the advent of the Cold War, no agent had the courage to publicly question Anslinger's policies either. His control over the FBN and its agents was absolute and served to magnify his mistakes, the biggest of which was having agents initiate two cases a month, thus forcing them to arrest as many addicts as possible. This “two buys and a bust” format enabled him to compile the statistics he needed to impress the congressional appropriations committees, and ensure that conspiracy cases were managed by a cadre of trusted friends, but it also focused attention on addicts rather than distributors, and it fostered a cut-throat environment that pitted case-making agents against one another, with dire consequences for the FBN.

Anslinger was the prototype of what modern agents facetiously call “a suit.” His battles were waged in boardrooms, the halls of Congress, and
the press. His angst was over the fate of the nation's ruling elite, not its average citizens, and yet that class consciousness served only to enhance his exquisite mystique – his carefully crafted image as a man serving a higher purpose in which his agents could believe. And they believed. They looked at Anslinger with nostalgic awe, as a symbol of the higher authority from which their powers derived. His presence looms.

Despite Harry Anslinger's penchant for self-promotion, much of the FBN's pre-war activities on behalf of the national security Establishment remain unrecorded. The only detailed account is Maurice Helbrant's frank and colorful autobiography,
Narcotic Agent.
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Born in Rumania and raised in Brooklyn, Helbrant spied for the British in Palestine during the First World War. His work involved him in the region's drug trade, and when he returned to America he joined the Old PU's Narcotics Division. Personable, attentive, and physically unthreatening, Helbrant was the ideal undercover agent, able to pose as a crazed cocaine addict when working the streets or as a wealthy underworld financier when pursuing wholesale distributors. Among his many accomplishments, Helbrant made the case on Jacob Polakiewitz, the primary purchaser from the Eliopoulos syndicate for one of the largest Jewish–American drug-smuggling syndicates prior to the Second World War.

As Helbrant explains in his book, agents in the early days of the FBN received little guidance from headquarters. They had a procedures manual, yes, but Prohibition had blurred the line between right and wrong, and case-makers learned to be wary of ambitious bosses who, in their quest to show success, asked them to do little things – like setting up illegal wiretaps or breaking into a drug dealer's apartment to plant evidence – that could
get them in trouble. They were also suspicious of bosses who asked them to look the other way.

A story from Helbrant's life neatly captures this predicament. Through an informant he acquired in New Orleans in the fall of 1934, he learned that two oystermen were trying to sell a shipment of heroin to a distribution syndicate managed by Sylvestro “Sam” Carolla, head of the Mafia in New Orleans, and Carolla's
consigliere
, Onifio “Nofie” Pecoraro. Helbrant subsequently tailed the oystermen to a meeting with their supplier, Eugene Coindet Aguilar, whom he arrested. During a routine body search, Helbrant found a slip of paper with Coindet's address, and the ensuing search of his apartment led to the seizure of $100,000 worth of heroin. It also turned up a list of firearms Coindet intended to purchase with the money he would have made from selling the heroin to the oystermen. However – and this is where he was asked to look the other way – Helbrant soon discovered that Coindet was planning to use his drug-smuggling profits to help Honduran opposition leader Jose Maria Guillen Velez finance a rebellion in Honduras, where the collapse of the banana economy had prompted President Tiburcino Carias Andino (the man Guillen hoped to topple) to resort to drug smuggling too.

Worse news was yet to come, for Helbrant had inadvertently opened a window onto the activities of Raymond J. Kennett, traffic manager in late 1934 for the cargo airline Transportes Aereos Centro-Americanos (TACA). Kennett had been arrested for selling drugs in New Orleans in the early 1930s, but New Orleans police chief Guy R. Maloney had reduced his sentence and then quit his job to become the arsenal inspector for the Honduran government. Also involved with Kennett were arms smuggler Edwin E. Huber, head of the Huber-Honduras Company, a link in a narcotic pipeline from Germany to North America; Isodore Slobotsky, owner of the Star Furniture Company and the TACA agent in New Orleans; and Lowell Yerex, owner of TACA.

Helbrant noted that the Honduran Drugs For Guns case sparked “an international incident with strange detectives from Washington making mysterious appearances and disappearances and rumblings like small earthquakes upsetting the New Orleans underworld.”
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What he was implying was that the “strange” detectives from Washington were there to shield Kennett and his TACA associates. And they were: elections were to be held in Honduras in October 1936, and Kennett and associates, by supporting the US-backed candidate, Tiburcino Carias Andino, required protection. So the State Department “ordered all surveillance of the TACA group curtailed,” and the detectives concluded their investigation in March
1936 without uncovering any hint of TACA's involvement in drug smuggling.
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Carias went on to win the election, and though the FBN knew he was smuggling drugs into Panama on TACA planes in 1937, top US officials, including Stuart Fuller and Harry Anslinger, looked away, because Carias provided the US government and its corporate backers with a valuable ally in Latin America as war loomed on the horizon and America's enemies maneuvered for influence in the region.

As historians Kinder and Walker said about the case, “the defense of the Western hemisphere against the Axis powers … reduced to insignificance clandestine attempts to link the managerial personnel of a major cargo airline to smuggling.”
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Author Peter Dale Scott, an expert on the “deep political” aspects of drug smuggling, is blunter and notes that Anslinger “cracked down on the Liberal opposition's New Orleans heroin connection, but let the government's connection [Carias] continue unhindered.”
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The government's pseudo-investigation of TACA was terminated in 1938 with the Treasury Department promising “to halt all surveillance of Yerex's activities whenever he came to the United States.” By March 1939, TACA held cargo service concessions in Costa Rica, Nicaragua, Guatemala, El Salvador, and Honduras and continued to engage in smuggling activities “virtually untouched by government action.” William K. Jackson, vice president of United Fruit, put the situation in economic perspective: “The greater the development of our trade relations with Latin America, the lesser will be their dependence and ours upon the whims of some European dictatorial ruler.”
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Along with the Opium Scandal of 1927 and the Kao case of 1929, the TACA case proves that the government protected drug smugglers to ensure national security, as well as to protect corporate profits. It also highlights the sad fact that case-making agents like Helbrant were aware of such machinations, but were unable to stop them. Anslinger went along with this unstated policy for two reasons: he needed drug addicts to justify his Bureau's existence and, by allowing certain politically acceptable drug rings to exist, he became a key player in the espionage Establishment.

Anslinger was a seasoned bureaucrat with secret police powers that enabled him to decide, in consultation with other top officials, which drug-smuggling rings were to be targeted and which were to remain intact. This
applied especially to the Nationalist Chinese government, which, since its inception in 1927, relied heavily on drug-smuggling revenues.

Reports submitted by Foreign Service officers, military Attachés, informants, and Treasury Attaché M. R. Nicholson in Shanghai left no doubt that China and Japan were the major exporters of opiates to the US illicit market throughout the 1930s.
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As historians Kinder and Walker explain, “Fuller and Anslinger clearly knew about the ties between Chiang and opium dealers.”
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Anslinger knew that Shanghai was “the prime producer and exporter to the illicit world drug markets,” through a syndicate controlled by Du Yue-sheng, the crime lord who facilitated Chiang's bloody ascent to power in 1927.
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As early as 1932, Anslinger knew that Du's political protectors were Chiang and his finance minister, T. V. Soong. He also had evidence that American t'ongs were receiving narcotics from Du and his KMT associates and then distributing them to the Mafia. For example, after their arrest by FBN agents in 1933, the Ezras revealed that Paul Yip was their contact in Shanghai. Yip worked with Du, the Japanese occupation forces in Manchuria, and Dr. Lansing Ling, who “supplied narcotics to Chinese officials traveling abroad.”
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In 1938 Chiang Kai-shek would name Dr. Ling head of his Narcotic Control Department!

The evidence continued to mount and in October 1934 Treasury Attaché Nicholson submitted reports implicating Chiang Kai-shek and possibly T. V. Soong in the heroin trade to North America.
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And in 1935 he reported that Soong's protégé, the superintendent of Maritime Customs in Shanghai, was “acting as agent for Chiang Kai-shek in arranging for the preparation and shipment of the stuff to the United States.”
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Nicholson's reports reached Anslinger's desk, so the Commissioner knew which KMT officials and trade missions were delivering dope to American t'ongs, which American drug rings were buying it, and that the t'ongs were kicking back a percentage of the profits to finance Chiang's regime – none of which he could ever reveal.
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After Japanese forces seized Shanghai in August 1937, Anslinger was less willing than ever to deal honestly with the situation. He knew that Du had sat on Shanghai's Municipal Board with William J. Keswick – a director of the Jardine Matheson Shipping Company – and that through Keswick, Du had found sanctuary in Hong Kong, where he was welcomed by a cabal of free-trading Brits whose shipping and banking companies earned huge revenues by allowing Du to push his drugs on the hapless Chinese. The revenues were truly immense: according to Colonel Joseph Stilwell, the US military Attaché in China, in 1935 there were an estimated “eight
million Chinese heroin and morphine addicts and another 72 million Chinese opium addicts.”
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Corporate profits were as important as national security and by 1938, Du was collaborating with the Japanese while his Green Gang was spying on them for Chiang's intelligence service. From the national security perspective, to which Anslinger adhered, information provided by Du's agents to Chiang's intelligence chief, General Tai Li, offset the human damage done by the shiploads of Persian opium Tai Li and Du sold to the Japanese, for distribution in China. But Du's massive payoffs enabled the KMT to purchase $31 million worth of fighter planes from arms dealer William Pawley, and that national security exigency, as Anslinger knew, trumped any moral dilemmas about trading with the enemy.

His resolve stiffened as war with Japan became imminent. He put his stamp of approval on a Foreign Policy Association report exonerating the Nationalists and blaming Japan for the narcotics problem in China. And, after a dozen of Lucky Luciano's associates were nabbed during the Hip Sing T'ong roundup in November 1937, he even sought information from his most hated rival; in the summer of 1938 he sent George White (the FBN agent who had made the Hip Sing T'ong case) and Secret Service Agent John Hanly to interview Luciano at Dannemora Prison in upper New York State. Though Hanly reported that Luciano was unhelpful, the Navy would soon form relations with the Mafia – and the Kuomintang-connected Hip Sing T'ong would continue to receive opium from the Far East with apparent impunity.
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Anslinger not only cooperated with America's espionage Establishment by protecting Nationalist China's drug-smuggling operations, he also turned a blind eye to the TACA operation and thus provided the Mafia with a steady source of supply into Louisiana at the same time Frank Costello and Meyer Lansky were opening a slot machine franchise in New Orleans and entrusting it to Mafia chieftain Sam Carolla. Though convicted of murdering a federal narcotic officer in 1932, Carolla had used his drug-smuggling profits to buy political protection and, after receiving a pardon from Louisiana Governor O. K. Allen, served only two years in prison for his crime.
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